Gold and silver prices rose in Indian markets after a sharp drop in the previous session. On MCX, December gold futures were up nearly 1% to ₹50,219 for every 10 grams, while silver futures rose 2% to ₹62116 per kg. In the previous session, gold had plummeted ₹2,500 for every 10 grams in Indian markets, while silver collapsed ₹4,600 per kg after Pfizer reported promising results from a large-scale coronavirus vaccine study.
In global markets, gold prices rose today after falling more than 5% in the previous session. Spot gold was up 0.5% at $ 1,871.81 an ounce. In the previous session, precious metals fell $ 1,849.93, their lowest level since September 28, after US pharmaceutical company Pfizer Inc said its experimental COVID-19 vaccine was more than 90% effective, according to initial test results. Investors pulled out of defensive assets and placed cash in markets that are closely tied to economic growth. Gold has been stripped of most of America’s election gains after the news of the vaccine.
Among other precious metals, silver was up 0.1% at $ 24.10 an ounce today, while platinum was up 0.2% at $ 868.30.
Most Asian stock markets rallied today following Wall Street’s overnight rally that took US stocks to record highs.
Analysts say hopes for more US stimulus measures helped support gold at lower levels. Concerns about rising coronavirus cases and legal challenges to the US election result also helped support at lower levels. Meanwhile, the Federal Reserve has warned that asset prices in key markets could be affected if the economic impact of the pandemic worsens in the coming months.
ETF investors were on the sidelines after the news of the vaccine. Shares in SPDR Gold Trust, the world’s largest gold-backed gold ETF or exchange-traded fund, fell 0.83% to 1,249.79 tonnes on Monday.
Back in India, gold ETF entries continued in October despite a rising equity market. During the month, gold ETFs posted net inflows of ₹384 million rupees, bringing total assets under management to ₹Rs 13,969 crore, according to the latest figures released by the mutual fund industry body, the Association of Mutual Funds in India (AMFI).
The fall in the price of gold may boost the demand for jewelry in India. Dhanteras and Diwali will be celebrated this week.
Likewise, the eighth tranche of gold sovereign bonds of this fiscal is open for subscription. The issue price has been set at ₹5.177 per gram of gold. A discount of ₹Investors who request online will have 50 per gram and the payment against the application will be made digitally. (With contributions from the agency)
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